Rebirth: I am in Jin-Cha-Ji

Some of these abandoned projects were already completed, while others were still underway. However, Poland, in its pursuit of transformation, transferred these projects to China. China offered light industrial products, agricultural and sideline products, and some minerals in exchange for these projects being established in China.

Many provinces were eyeing this mining machinery factory. Zeng Xisheng threw a tantrum at the meeting, leading to the project being moved to Hefei. However, the meeting's approval was also due to the Huainan Mining Bureau's achievement of 1957 million tons of coal mining in 2000, which earned it a commendation from the central government. The Huainan Mining Bureau wanted to upgrade its coal mines and needed the support of the mining machinery factory.

After several hours of heated debate, the projects were finally divided roughly. Ultimately, however, the industrially strong provinces still took the lion's share. After all, while there were political considerations, the greater concern lay in the overall interests of industrial development.

Everyone was tired of arguing, so they took a short break to calm down. Then they started talking about the factory established by the rural cooperative that Wei Hongjun had mentioned.

"We have sent people to investigate the issue of rural cooperative factories in Guangdong. The largest factory in the Bao'an District rural cooperative processes materials for Hong Kong businessmen, primarily producing clothing, curtains, towels, and other products. This factory employs 1344 people."

"The factory's annual profit is between 30 and 50 yuan. Behind this factory are three rural cooperatives, each with a significant membership base. Together, they have over 2400 members. Last year, the factory distributed dividends to these three cooperatives, and each family received an average of over 400 yuan."

"And this isn't the end. Their factories produce products quickly, with high quality, and smooth communication. Compared to large state-owned factories that typically only take large orders and are generally reluctant to accept orders of hundreds or even thousands of units, many small businesses are very willing to cooperate with rural cooperative factories. As long as the demands aren't excessive, these factories are willing to meet them. They can even accommodate changes to the contract mid-way through the collaboration. As a result, they're receiving more and more orders, including some large ones, and are already preparing to expand their factories."

"If they expand again this time, it will become a medium-sized factory. The number of workers will likely exceed 2000, and the annual profit could reach 1000 to yuan. When these rural cooperative members share dividends, each family can get yuan. A factory of this size is no smaller than some state-owned factories, and its profit potential is even greater than some state-owned factories."

After Wei Hongjun's report reached the Finance and Economics Working Committee, the Ministry of Light Industry and the Ministry of Commerce immediately sent people to find out the specific situation.

So Minister of Commerce Yao Yilin gave everyone a detailed introduction to this factory in Bao'an District, Guangdong.

Many people were surprised. They never imagined that a factory run by a group of farmers could generate hundreds of thousands of yuan in annual profits. And this was just the beginning; if things continued to grow, the annual profit could reach 100 or 200 yuan. If this continued, could the factory's profits exceed million or million yuan in the future? This was something no one had even considered.

Many state-funded factories are now large, with annual profits of only a few million or tens of millions. Some state-owned factories are even unable to generate their own revenue and require state funding. Only the oil sector has money, like the Songliao Oilfield, which, in addition to substantial taxes, can also contribute hundreds of millions in profits to the state.

But how could a factory built by a group of farmers make such a profit in a year? How could it not surprise everyone? They had been a little bit unconvinced when they saw Wei Hongjun's report, but now they were even more surprised.

Yao Yilin continued, "Currently, the Bao'an Special District has a lot of collaboration with British and Chinese businesses, including our own trading companies in Hong Kong, Macau, and Southeast Asia. The scope of processing with supplied materials is also expanding, and many of these collaborations are in conjunction with factories run by these rural cooperatives. Therefore, there are quite a few potential rural cooperative factories here. In addition to these processing-with-supplied-materials factories, there are also various other types of factories."

"During our investigation, we discovered that several rural cooperatives have joined forces to form a very large transport company. Because their prices are low and they can accept orders at any time, they are very popular with small factories in the surrounding area. Currently, in Guangzhou and Bao'an Prefecture, large orders from large factories are handled by large state-owned transport companies, using large trucks. However, small orders from small factories are generally handled by transport companies run by these rural cooperatives."

"This is the situation in Guangdong. Heilongjiang also faces this problem. Many small furniture factories originally operated by rural cooperatives in Heilongjiang have grown significantly over the years through cooperation with the Soviet Union. Just like in Guangdong, many cooperatives have banded together to expand their operations and increase production capacity. Before we knew it, some factories employed 700 to 800 people, or even over a thousand. Many have become as powerful as state-owned factories."

"In addition to opening factories, this trend is also evident in the supply and marketing cooperatives run by rural cooperatives. There's an increasing trend of cooperation between rural cooperatives, uniting to divide the work and develop a free market for agricultural and sideline products. As a result, some supply and marketing cooperatives run by rural cooperatives offer a wide variety of agricultural and sideline products in large quantities, which has been very popular among the people."

After Yao Yilin finished speaking, everyone fell into a brief silence. They flipped through the Ministry of Commerce report, feeling both happy and worried.

I am happy because many rural areas have developed so well without us noticing.

According to a report from the Ministry of Commerce, many rural cooperatives are now thriving with their sideline businesses, providing members with substantial additional income each year.

The concern is that if the rural cooperative factories continue to develop in this way, many problems will inevitably arise. Apart from other factors, these factories in Bao'an District are currently small, so the impact is not significant.

However, when these factories continue to grow and even begin to threaten the interests of some large state-owned factories, there will inevitably be turmoil.

Guangdong's largest garment factory, invested and built by the Guangdong provincial government, was one of the earliest factories to engage in processing trade. After years of development and with financial support from the provincial government, it has grown into a large factory with 30,000 workers, holding a crucial position in Guangdong Province.

This was Guangdong's first garment factory, and as processing with supplied materials grew, Guangdong Province established a second and third garment factory. Even Guangzhou City and Bao'an Prefecture funded the establishment of similar processing factories.

If one day the factories run by rural cooperatives start competing with these state-owned factories for orders, they will inevitably suffer a blow from them.

And who will the local government favor? There is no need to consider this. They will definitely support the state-owned enterprises. After all, these state-owned enterprises are their own children.

"Comrade Yao Yilin, what does your Ministry of Commerce mean?"

"I've carefully read Secretary Wei's proposal, and our Ministry of Commerce believes it's highly feasible. It's also the inevitable path for rural cooperative factories. Small factories like these can't expand indefinitely. Therefore, transitioning from small collective ownership to mixed ownership not only protects the factories but also fosters more socialist elements within small collective ownership."

All of you here have practical work experience, and many of you have worked at the grassroots level.

If the rural cooperative factories were to be suppressed by the state-owned enterprises in the future, they would have little room to fight back because the political and economic status of both sides was inherently unequal.

Therefore, it is essential for these factories to introduce some "protection agencies." This is also the necessary path for the transition from the primary stage of socialism to the advanced stage. Small collective ownership can be said to be a product of the primary stage of socialism, while the advanced stage of socialism will undoubtedly require more large collective ownership.

“How does the Ministry of Commerce think these factories should be invested?”

"First, we need to determine the assets of these factories. Then, based on the assets, we won't buy shares in the factories, but rather expand their production. The main issues after the investment will be factory management rights, financial supervision, and profit distribution."

Solving this problem is quite complex, as it involves not only investment but also the subsequent development of the factory.

For such factories, there will be new changes in their nature, financial supervision, profit distribution, and even taxation.

Wei Hongjun interjected, "The transition from small collective ownership to mixed-ownership enterprises complicates the shareholding structure, but upon closer inspection, it's not that complicated. Mixed ownership adds either state-owned or large collective ownership, so small collective ownership adds some socialist elements. Therefore, when formulating policies for these enterprises, a compromise can be struck between small collective and state-owned ownership. Management rights should be handed over to the small collective, while supervisory and distribution rights should be based on the regulations of large collective and state-owned enterprises. Mixed ownership inherently shares many similarities with state-owned and large collective ownership."

In fact, whether it's a state-owned enterprise, a private enterprise, or a mixed-ownership enterprise, the same problems arise when the enterprise grows in size. It's not the case that state-owned enterprises are inherently inefficient and overstaffed, while private enterprises don't have these problems.

Because this is not a problem between state-owned enterprises and private enterprises, but a problem of big enterprises, which is a common problem among large enterprises.

How to effectively manage large enterprises is a goal pursued by both state-owned and private enterprises. Improving efficiency, preventing the embezzlement of corporate funds, discouraging the use of connections, and guarding against cliques and factions involved in private transactions are common challenges faced by all large enterprises.

Rural cooperatives will also face this problem once they expand. Therefore, they should learn from large state-owned enterprises in terms of supervision and distribution.

It was precisely because of this that Liang Guang raised the issue of trade unions in these enterprises.

"Comrade Hongjun is right. After small collective-owned enterprises become mixed-ownership enterprises, they become closer to large collective-owned enterprises. In terms of internal factory regulations, especially supervision, we still need to learn some things from large collective-owned enterprises."

Chen Yun nodded in support of Wei Hongjun's argument. However, he remained cautious, saying, "Comrade Yao Yilin, I think the Ministry of Commerce should first identify a few small collectively owned enterprises and conduct mixed-ownership reforms. Then, we'll see how the situation develops and then formulate further regulations."

"That's exactly what we at the Ministry of Commerce are thinking about."

Yao Yilin nodded.

The government wanted to invest in the factory, which was originally owned by a rural cooperative. Convincing these cooperatives of the government's intention to take a stake was a major challenge. How could they accept this change and successfully complete the mixed-ownership reform, while also ensuring that they understood it was not asset confiscation?

Furthermore, after the government takes a stake, how can we prevent these factories from experiencing poor operations and management due to changes in ownership? These are things that require careful consideration and practical implementation.

The government's investment in these factories is intended to keep them going, not to destroy them. Therefore, experiments are necessary.

Deng Zhihui then spoke up: "Since the three rural cooperatives have joined together to run the factory, how is the cooperation between the three rural cooperatives now?"

Deng Zhihui looked at the information from the Ministry of Commerce and combined it with the information from the Ministry of Rural Work and found some problems.

That is, the larger factories nowadays are usually jointly run by several rural cooperatives, because a single rural cooperative does not have the capacity to run a large-scale factory.

One reason is that rural cooperatives have limited funds, and the bigger problem is insufficient population. Although the national rural development cooperatives have entered the advanced cooperative stage.

However, advanced cooperatives refer more to the public ownership of rural means of production, rather than being categorized by population. Currently, rural cooperatives are primarily organized around natural villages, so most have only a few hundred members. Some even have only one or two hundred members.

A rural cooperative of this size cannot support such a large-scale factory.

So when several rural cooperatives jointly set up a factory, how are the relationships between these rural cooperatives handled?

Who leads whom? How should factory profits be distributed? How can we prevent conflicts between rural cooperatives? These are not easy issues to deal with.

The rural cooperative's factory development was so rapid that it had exceeded the expectations of Wei Hongjun, Deng Zhihui, and others. Therefore, Wei Hongjun and Deng Zhihui had not considered this issue before.

But we cannot ignore this issue now. How do these rural cooperatives cooperate when they unite to run factories? How do they balance internal relationships? How do they resolve leadership issues?

"Yes. Judging from the situation of this investigation, cooperation between cooperatives is often proactive. They will find suitable partners to cooperate with."

Yao Yilin nodded.

Sometimes cooperatives collaborate to expand production. For example, when everyone is processing supplied materials, they discover that some orders are too small for their factories to complete. So, several cooperatives join together to expand their factories, thus being able to take on orders they previously couldn't fulfill.

Some people also cooperate to divide labor. For example, cooperatives band together to form supply and marketing cooperatives, where they divide their own labor. Some handle transportation, some plant crops, and some market them. Each has its own division of labor, but they work together to achieve common development.

"Is their internal distribution method based solely on the shares acquired during the cooperative period? What happens when there are disagreements among the cooperatives regarding production and distribution?"

“We don’t have a detailed understanding of this.”

Yao Yilin shook his head.

The Ministry of Commerce is primarily investigating the development of these factories. As for how the three rural cooperatives are cooperating, that's outside the Ministry of Commerce's scope of investigation. That's the responsibility of the Rural Affairs Department.

Deng Zhihui didn't ask any further questions. Regarding the rural cooperative factory issue, the overall approach continued with Wei Hongjun's report.

The Finance and Economics Working Committee generally acknowledged that Wei Hongjun's approach was correct, but the specific plan needed further clarification.

This includes determining what size rural cooperatives are eligible for equity participation, and which department will need approval if local governments wish to participate in such enterprises.

This is of paramount importance. Without restrictive policies, if grassroots governments quickly acquire shares, they will immediately swallow up these rural cooperatives. Therefore, it is imperative to limit these grassroots governments' shareholdings.

Wei Hongjun listened quietly to these specific questions.

The meeting finally decided that Deng Xixian would be responsible for the implementation and construction of Eastern European industrial projects and French cooperation projects, Li Fuchun would be responsible for handling local steel industry development issues, and Deng Zhihui, Zhou Bin, and Zeng Shan would be responsible for rural cooperative factory issues.

After the meeting, Deng Zhihui and Wei Hongjun left the venue, saying, "There's more and more cooperation between rural cooperatives. This isn't just true in industry and commerce; it's a trend in many areas."

"The Ministry of Education has also recently responded. While it might seem like a good idea for every rural cooperative to have a primary school, it also wastes a lot of resources. This is especially true when some rural cooperatives are close to each other. In this case, just one primary school between several rural cooperatives would be enough to meet the needs of the surrounding children."

Wei Hongjun paused and thought for a moment after hearing Deng Zhihui's words. "Let's go to my office and talk," he said after a moment.

1051 Cooperative Union

"There is more and more cooperation between cooperatives, and how to deal with the relationship between them is also a big problem."

After arriving at Wei Hongjun's office, he made Deng Zhihui a cup of tea. Having worked together for many years, Wei Hongjun didn't hold back and directly discussed the cooperative's cooperation issues.

"Yes."

Deng Zhihui nodded.

Dao said: "Some time ago, when Comrade Tao Lujia came to Beijing, I also discussed this issue with him when we were discussing rural work. He told me at the time that some rural cooperatives in Shanxi had independently cooperated and established a cooperative association."

"There are several purposes for establishing this kind of cooperative. One is to pool more resources and manpower to participate in larger-scale water conservancy and road construction projects."

"Another advantage is that cooperation can save resources. In rural education and healthcare, resources can be concentrated. Central hospitals and schools can be established, and several rural cooperatives can use them together. This approach requires less investment and is suitable for current rural conditions. If each rural cooperative only builds one hospital and one school, it would be a waste of resources and many rural cooperatives would not be able to afford it."

"However, if several rural cooperatives unite, it will not only reduce the burden on each cooperative, but also avoid wasting resources. The surrounding rural cooperatives will all be able to enjoy education and medical care."

"But at the time I just paid some attention to it and didn't think about it any further. But this time, seeing the development of the rural cooperative factory, I realized that this is not a simple matter."

"If cooperatives want to achieve this kind of union, they definitely need to work together. Only after the work is done can they truly cooperate. But apart from these successful collaborations, there are probably many cooperatives that are unable to cooperate due to too many conflicts. So what should we do about them?"

Deng Zhihui had previously not paid much attention to the issue of cooperation between cooperatives. Even when Shanxi Provincial Party Secretary Tao Lujia announced that autonomous cooperatives had emerged in Shanxi, this did not attract Deng Zhihui's attention.

But at this financial work conference, the Ministry of Commerce's investigation report suddenly woke Deng Zhihui up.

Because cooperation in cooperatives is not a simple matter now. Guangdong, Heilongjiang, and Shanxi are all completely different provinces, and the situations in each province are also completely different.

Yet, these cooperatives all coincided with each other. Some were driven by industrial production, others by division of labor, others by resource pooling, and still others by resource conservation. This caught Deng Zhihui's attention.

It is no coincidence that cooperation between cooperatives has emerged in different provinces for different reasons.

Wei Hongjun said: "It's not just Guangdong. It's also the case in places like Shanxi. I also discovered this situation in Henan the last time I went south."

"Comrade Luo Weilin mentioned to me a problem that arose during Henan's mountain and water conservation efforts. If it were a major project led by the central government or provincial or municipal governments, there wouldn't be many problems. The people of Henan are highly aware of this and are not afraid of difficulties. They will definitely not hinder national projects."

"But when it comes to managing mountains and rivers at the grassroots level, numerous problems arise, making the work extremely difficult to implement. This is because the boundaries and land ownership between rural production cooperatives are unclear. Once we start working on mountain and river management, we easily run into these issues, as they directly impact the interests of the various production cooperatives. Consequently, many townships in Henan Province, even though they want to implement mountain and river management, are unable to resolve conflicts between the rural cooperatives at the grassroots level, hindering progress."

"But the situation in Henan is similar across the country. All provinces can't just focus on large-scale construction. Many water conservancy projects and fertile farmland development projects below the county level require rural cooperatives as the basic units to complete the work. However, given the current scale of many rural cooperatives, they cannot complete these tasks alone, so several rural cooperatives must unite. How to make rural cooperatives with conflicts cooperate is something we really need to consider."

"It's easy to talk about uniting rural cooperatives, but it's very difficult to actually do it. Comrade Luo Weilin told me there's a saying circulating among grassroots units in Henan: 'An old buffalo falls into a well and can't use its strength.' This describes the situation faced by many grassroots units in Henan."

Things develop in a regular pattern.

Many things do not appear suddenly or are created by a political leader.

Just like when people online praise Emperor Yang of Sui, many claim that Yang Guang initiated the imperial examination system. But the imperial examination system wasn't suddenly created by a single emperor; this completely contradicts the laws of historical development. It evolved over a long period of time, gradually improving until it finally became the imperial examination system under the leadership of Emperor Wen of Sui.

The same is true of the "people's commune" that emerged in history. It wasn't something the Chairman created. Instead, after productivity had developed to that point, local prototypes emerged based on actual circumstances. In other words, local cooperatives were first established based on local conditions. Even the name "people's commune" wasn't coined by the Chairman. The name came first, and the Chairman simply chose it.